Coverage

Dimension 27.1: CG.

Dimensions 27.2, 27.3 and 27.4: BCG.

Time period

Dimensions 27.1, 27.2 and 27.3: At time of assessment, covering the preceding fiscal year.

Dimension 27.4: At time of assessment.

Measurement guidance

Reliable reporting of financial information requires constant checking and verification of the recording practices of accountants. This is an important part of internal control and a foundation for good information for management and for external reports. The indicator covers three critical types of reconciliation.

Dimension 27.1 assesses the regularity of bank reconciliation. There should be regular and timely comparisons between government bank account (central or commercial) transaction data and government cash books. The results of the comparisons should be reported and action should be taken to reconcile any differences. Such reconciliation is fundamental to the integrity of the accounting records and the financial statements.

Dimension 27.2 assesses the extent to which suspense accounts, including sundry deposits/liabilities, are reconciled on a regular basis and cleared in a timely way. Failure to clear suspense accounts can distort financial reports and provide an opportunity for fraudulent or corrupt behaviors.

Dimension 27.3 assesses the extent to which advance accounts are reconciled and cleared. Advances cover amounts paid to vendors under public procurement contracts as well as travel advances and operational imprests. In the case of public procurement contracts, clearing timelines will be compliant with contractual arrangements. Other clearing processes will follow national regulations. The present indicator does not cover intergovernmental transfers even though they may be called “advances”. Complete, accurate, reliable, and timely information is essential to support the internal controls system. Information relevant to assessment of this dimension is produced by many information systems, encompassing people, processes, data, and IT. Those elements are dealt with under PI-23 for payroll and PI-25 for commitments and payments.

Dimension 27.4 assesses the extent to which processes support the delivery of financial information and focuses on data integrity defined as accuracy and completeness of data (ISO/IEC, International Standard, 2014). While acknowledging that other processes are also essential to ensure data integrity, this dimension assesses two key aspects: access to information, including read-only, and changes to records by creation and modification; and existence of a body, unit or team in charge of verifying data integrity. Audit trails constitute an important aspect of data integrity as they enable individual accountability, intrusion detection, and problem analysis.